Since
last year, Doyen Sports, represented by Jean-Louis Dupont, embarked on a legal
crusade against FIFA’s TPO ban. It has lodged a competition law complaint with
the EU Commission and started court proceedings in France and Belgium. In a first
decision on Doyen’s request for provisory measures, the Brussels Court of First
Instance rejected the demands raised by Doyen and already refused to send a
preliminary reference to the CJEU. Doyen, supported by the Belgium club Seraing,
decided to appeal this decision to the Brussels Appeal Court, which rendered
its final ruling on the question on 10 March 2016.[1] The
decision (on file with us) is rather unspectacular and in line with the first
instance judgment. This blog post will rehash the three interesting aspects of
the case.

·
The jurisdiction of the Belgian courts

·
The admissibility of Doyen’s action

·
The conditions for awarding provisory measures

I. The jurisdiction of the Belgian courts

Doyen was
not the only party to the dispute dissatisfied with the first instance ruling;
FIFA and UEFA also appealed the decision challenging the territorial competence
of the Belgian Court to hear the claims raised against FIFA’s TPO ban. They
consider that the Swiss courts are solely competent to deal with civil disputes
involving its rules and decisions.

Moreover,
to support their view that Swiss Courts have an exclusive jurisdiction, FIFA
and UEFA also invoke Article 22(2) Lugano Convention stipulating that
“proceedings which have as their object the validity of the constitution, the
nullity or the dissolution of companies or other legal persons or associations
of natural or legal persons, or of the validity of the decisions of their
organs, the courts of the State bound by this Convention in which the company,
legal person or association has its seat. In order to determine that seat, the
court shall apply its rules of private international law”. Yet, the Appeal
Court is of a different opinion and refers to the jurisprudence of the CJEU
indicating that Article 22(2) should be interpreted as referring to disputes
lodged based on company law or their statutes against decisions of a company or
association.

The
principle enshrined in Article 2 Lugano Convention is not absolute, many exceptions
are provided in the Lugano Convention itself. In particular, Article 5(3)
Lugano Convention foresees that in delictual matters the court of the place
where the harmful event occurred or may occur is competent. This entails both
the place were the harmful conduct was put in motion and the place where the
harm was felt. In the present case, the Appeal Court argues that it is
“difficult to contest that by hindering the appellant to execute their
partnership agreement and enter in future TPO or TPI agreements over specific
players, the attacked ban is producing harmful effects on the Belgian
territory”.[2]
Furthermore, the TPO agreement between Doyen Sports and the ASBL RFC Seraing is
not deemed fictitious, as it has been invoked by FIFA to hand out disciplinary
sanctions to the ASBL RFC Seraing.[3]

Additionally,
the Court derives also its competence from Article 6(1) Lugano Convention. This
article provides that a party can be sued “where he is one of a number of
defendants, in the courts for the place where any one of them is domiciled,
provided the claims are so closely connected that it is expedient to hear and
determine them together to avoid the risk of irreconcilable judgments resulting
from separate proceedings”. The key question is whether there is sufficient connectedness
between the claims raised against l’URBSFA, FIFA and UEFA. The Court refers to
the recent case law of the CJEU, which is relevant to the interpretation of the
Lugano Convention, on the identical provision in the Brussels Regulation
(notably the case C-352/13 at para.
20). It is of the view that “FIFA and URBSFA share a regulatory and
disciplinary power that enables them both, acting jointly or separately, to
adopt the contested ban, to enforce it and to adopt an individual decision
susceptible to block, compromise and/or restrict the execution of the contract
signed by the appellants”.[4] Thus,
“the autonomous regulatory power of the URBSFA justifies its participation in
this proceeding, alongside FIFA in order (i) to obtain that both be prevented
to act; (ii) that each of them be deprived of the opportunity to contest the
opposability of a decision to which they would not have been part and lastly
(iii) to deny FIFA the possibility to circumvent an interdiction pronounced
against it by having recourse to the regulatory power of the URBSFA”.[5]
Finally, the Court argues “if the appellant were forced to lodge a claim
against FIFA in front of the Swiss courts and against URBSFA in front of the
Belgian Courts, this could potentially lead to irreconcilable solutions”.[6] As
far as the claims against UEFA are concerned, which has not contrary to FIFA
explicitly banned TPO, the Appeal Court is also convinced of their connectedness.
It is so because UEFA “imposes to the clubs needing a license to participate in
its competitions that they comply with the statutes and regulations of FIFA
and, thus, with the disputed TPO ban “.[7]

This is
again a powerful reminder that Sports Governing Bodies (SGBs) seated in
Switzerland cannot evade the jurisdiction of the national courts of EU Member
States when EU competition law is involved.[8] Under
Article 5(3) Lugano Convention, EU Member States courts will be competent to
deal with a civil liability claim based on EU competition law if the damage caused
by the disputed measure/decision/regulation can be felt on the national
territory of a Member State. Furthermore, if, as is usually the case for sports
regulations, the rules have to be implemented by national sporting
associations, the claims raised against the national SGBs will most likely be
deemed connected to the original decisions/regulations of the international
SGBs and justify the jurisdiction of the court of the domicile of the national
SGB.[9]

II. The admissibility of Doyen’s action

In this
proceeding, as well as in the one initiated in front of the Paris court (FIFA’s
legal submission in the Paris procedure has been published by
football leaks), FIFA argues that Doyen’s action is not admissible due to the
fact that the wrong administrator has initiated it. Indeed, under article 11.1
of Doyen’s own statutes the
judicial representation is to be exercised by the local administrator
designated by shareholder A acting in conjunction with the local administrator
designated by shareholder B or by any other person designated by the general
assembly. Yet, in practice Nelio Lucas, who fulfils none of the relevant
criteria and was thus not authorized to act in Doyen’s name in judicial
matters, lodged the action. However, Doyen could have under Belgium procedural
rules ratified the judicial initiative taken by an incompetent organ. Doyen
tried to do so but failed to organize the general assembly necessary to ratify
Nelio Luca’s decision. Thus, the Court deems the action initiated by Doyen
inadmissible. Luckily for Doyen it was not the sole party to the proceedings as
the ASBL RFC Seraing joined the procedure. The Court believes the intervention
of RFC Seraing in the proceedings is admissible and its interest to act is acknowledged.
On this latter point, FIFA was arguing that RFC Seraing’s interest to act was
inexistent due to the fact that the partnership agreement between Doyen and
Seraing was contrary to the public order. However, in light of the divergent
positions regarding the legality of TPO/TPI and of the on-going proceedings
before various national courts and the European commission, the Belgium court
is reluctant to admit that the interest of Seraing to act in this matter is
illegitimate.

III. Doyen’s (un)likelihood to prevail

As explained in our previous blog
on the first instance ruling in the same matter, Doyen and Seraing can obtain
provisory measures if they demonstrate that those measures are urgent and that
they are likely to prevail on substance in the main proceedings.

On the urgency
of adopting provisory measures, the Court sided with Seraing and Doyen. It
found that Seraing is subjected to disciplinary sanctions, even though their
execution is suspended, and is susceptible to incur further proceedings and
sanctions if it enters into new TPO/TPI agreements with Doyen.[10]
Moreover, it is un-doubtable that the prohibition of the agreement with Doyen
has deprived Seraing of financial resources that cannot be easily substituted
by classical loans from third parties.[11]
Consequently, the Court considers that the urgency requirement for provisory
measures is given.

Concerning
the likelihood to prevail, however, the Court sided with the federations and
refused to admit that the TPO/TPI ban was likely to restrict article 101(1) TFEU.
On the one hand, as indices of the compatibility of the ban with EU law, it
pointed out that the Commission was inclined to support the TPO ban, that
FIFPro was clearly opposed to TPO and invokes fundamental values in support of
the ban, and that the ban was adopted after a collective reflection involving
many stakeholders and is aimed at tackling the negative externalities listed by
the first instance court.[12] On
the other hand, it refers to an academic article authored by Marmayou contesting
the compatibility of TPO with EU law (this reference appears poorly chosen as
the article is dedicated primarily to the FIFA regulations for intermediaries,
for a stronger challenge to the compatibility of the TPO ban with EU law see Lindholm).[13] In
any case, “it is obvious that a preliminary assessment cannot lead the Court to
conclude, with sufficient certainty, that the ban would be contrary to EU
competition rules”.[14] Finally,
and this is the part of the ruling that seems to have been slightly misinterpreted
by the press. The Court pointed out that Seraing and Doyen were asking in the
main proceedings for a preliminary reference to the CJEU and that they were,
therefore, conscious that they are not certain to prevail. However, the Appeal Court cannot, in the framework of a procedure involving provisory measures, ask
a question to the CJEU, as it is unable to comply with the CJEU’s requirements
for the admissibility of preliminary references (see the failed
attempt in the UEFA FFP case). Hence, it is for the Commercial Court of
Brussels, which is competent in the main proceeding, to decide whether it is
necessary to do so. The Appeal Court (and the claimants as it cheekily points
out) seems to believe that it could be needed, as it is not at all clear that
the ban is contrary to EU competition law.

Conclusion

There are
number of lessons that can be drawn from the judgment of the appeal court.
Three stand out:

FIFA and
UEFA cannot evade the jurisdiction of EU courts. Indeed, if an EU competition
law violation of their rules is invoked they can be brought before the
jurisdictions of the Member States

Doyen messed
up in its original court filing by failing to abide by the procedure enshrined
in its own statutes. This has no dire consequences in the Belgium proceedings
due to presence of Seraing, but it might be a different story before the Paris
court, where Doyen stands alone and the same procedural irregularity is invoked
by FIFA.

To FIFA’s great
satisfaction, the case against the TPO ban is not deemed strong
enough to allow for the adoption of provisory measures blocking its
implementation. As pointed out in our previous blog (and here) EU
competition law is not a golden bullet that can be invoked easily to strike
down FIFA or UEFA regulations. There is a high justificatory burden and the
claimants will face an uphill battle to demonstrate that the ban is disproportionate
(especially in light of the broad support for the ban amongst many key
stakeholders).

This was only
a small skirmish in a long legal war still before us. It will not be definitely
over until the CJEU decides the matter (in 2018 at the earliest) or Doyen bows
out of the game in the face of the high legal fees incurred. What is already
certain is that the way EU law applies to sport is not straightforward and does
not entail an economic/neoliberal logic blindly favourable to an unrestricted freedom
to invest.

[8] The same solution was adopted in 2012 by the French
Cour de Cassation (Highest French Civil Court) in a dispute opposing the French
agent Piau to FIFA. See Cour de
cassation, civile, Chambre civile 1, 1 février 2012, publié au bulletin.

[9] This solution was also adopted by the OLG in the
Pechstein ruling, see Oberlandesgericht München, 15 January 2015, Az. U 1110/14 Kart, para.A.I.1.a)aa) and bb).

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